Startup Brand Strategy: An Investment Priority

Thomson DawsonJuly 22, 20131723 min

Publicity, image, design, taglines, slogans and great brand names — which of these is the most important to a growing startup brand? The answer is none of them.

Recently I attended a startup networking event in Santa Barbara, California hosted by an organization called StartupSB. It was well attended with over 100 early stage entrepreneurs in diverse businesses–everything from teas to technology. I was surprised to learn (so I was told by the organization’s founder) Santa Barbara is the fifth most active incubator in the US for venture capital funding of startups behind San Francisco, San Jose, Boston and Boulder respectively.

As I mingled about, I had several conversations with early stage CEOs about how important they thought brand strategy is to their growing business. In every instance, the response to my questions revealed the same answer–essentially  “we’re not far enough along to be able to invest in branding”. Their answer didn’t surprise me at all.

Most early stage CEOs are more concerned with securing seed capital rather than creating a foundational strategy for building brand value as they grow. Many believe branding is a tactical pursuit tied specifically to the creation of logos, taglines, image, publicity and marketing communications – an expensive endeavor to be completed after they are more established.

The startup community under invests in brand development.

Brand strategy and “branding” is not simply a name, a logo, or a tagline slogan—it’s a reason for being. Brand Strategy is a point of view and the expression of that point of view lies in building a foundation for the value the new enterprise will bring to customers it intends to serve.

Having clarity and confidence on how this strategy will guide business decisions and behavior in the marketplace is far more important and essential to early success than logo-making and tagline-writing.

It’s critical for early stage CEOs at the very beginning of their enterprise, to define the purpose and architecture of their brand.

Beyond the fascination with and the compulsion startup CEOs have for overstated valuations, early stage CEOs must be absolutely clear about their overarching purpose (beyond money-making), the set of core values that will drive and define the culture of their growing organization, a clear and concise statement about who the brand serves, why the brand matters to a specific customer target, and what relevant and distinguishing, highly valued idea the brand will represent in the mind of the customer. This strategic foundation must be established long before the brand name is selected!

Brand strategy insures the attraction of capital to your startup enterprise.

The foundation of brand strategy has important implications for successfully securing funding in the startup investment community as well. You can have the most innovative product or service idea ever conceived–but if you can’t articulate in simple terms why your startup will matter to targeted customers, it will be next to impossible to secure the levels of funding to scale and grow the business. Remember too the competitive demands for capital investment will require you have a clear and compelling brand story investors will find convincing and worthy.

And finally, developing a strategic foundation for your startup brand will guide in recruiting and retaining the most talented people who are the perfect fit for the culture of your organization.

Relative to the costs associated with product development, talent acquisition and marketing, investing in a concise and compelling brand strategy costs next to nothing in the grand scheme of growing the business and building equity in your startup brand.

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Thomson Dawson

One comment

  • Russell Volckmann

    July 23, 2013 at 8:14 pm

    Thomas, once again you zero in on a very important issues, which I will not comment on because you already covered every aspect profoundly.

    I would like to add this, however: In prospecting new clients for our brand consultancy, I had often thought that a marriage with emerging business investors seemed to make so much sense. As by definition, the funding organizations have a vested interest in ensuring their investments succeed. What I find is completely the opposite, where the pervasive raison d’être perplexingly never seems to count the intangible brand value on the balance sheet. A general lack of interest among investors, not just the startups.


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